The embassy row assassination three years ago of former Chilean ambassador Orlando Letelier and his associate Ronni Moffitt may be recreated in movie theaters if the early hopes of four Washington authors are realized. And actress Jane Fonda may have a role in one of the two productions being discussed.

Two pairs of local writers are preparing books about the Letelier case, and both pairs hope a movie will result from their work. Leading in the literary race are Institute of Policy Studies Director Saul Landau and a former Santiago-based reporter, John Dinges. Their book, tentatively titled Assassination on Embassy Row, is completed and will head Pantheon's spring list.

Meanwhile, a British journalist is using the manuscript to write a script for a movie under the aegis of director Haskell Wexler, whose last film was "Medium Cool." Wexler traveled to Hanoi with Jane Fonda, who he says is interested in playing a role in a movie about the murders. Three anti-Castro Cubans and a former Chilean secret police agent were convicted in the case.

Big studio interest in the murders comes from Warner Brothers, which reportedly wants to make a deal with Washington journalist Taylor Branch and the former prosecutor in the Letelier case, Eugene Propper. Branch and Propper have not begun to write a book, but Propper said recently that he and Branch were on the verge of signing a contract with Viking Press. The reported amount of their advance is $175,000.

"Warner Brothers says they're going to do the film," Propper says, "but they haven't put it on paper." Warner's vice president for production confirmed Propper's statement.

Propper, who is now in private practice with Lane & Edson, is angered by charges that he is profiting because of his insider's position on the case.

"Certainly as the prosecutor I had access to all sorts of documents," he says, "but I can no more use classified documents than [Landau and Dinges] could, and I certainly don't have those documents now. I didn't keep anything. I'm writing this book because I was responsible for what was the first political assassination in this city's history ever solved and brought to trial. The story, the politics and how it was solved is a story that had to be written."